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2019 (8) TMI 986 - AT - Income TaxCondonation of delay - delay of 277 days - assessee submitted, though the DRP has held that the assessee comes within the purview of Knowledge Process Outsourcing (KPO) Company and since due to the relief granted by the DRP on other issues, assessee’s margin came within the acceptable range of the margin of the comparables requiring no further adjustment, assessee was advised not to file any appeal or cross objection initially but subsequently, on professional advice, assessee filed the present cross objections - HELD THAT:- Delay in filing the present cross objections is due to reasonable cause. Accordingly, we condone the delay and admit the cross objections for adjudication on merit. TP Adjustment - comparable selection - HELD THAT:- Coral Hubs Ltd. - as seen from the materials available on record that the personnel cost as a ratio of the total cost works out to 4.40% as against assessee’s personnel cost of 36.37% - unlike the assessee, this company is not providing services itself, but has employed third party vendors to do the work. Thus, the business model of the company is totally different from the assessee. Considering the aforesaid aspect, the Tribunal in Cummins Turbo Technologies Ltd. [2018 (3) TMI 1588 - BOMBAY HIGH COURT] has excluded this company as a comparable. The aforesaid decision of the Tribunal was approved by the Hon'ble Jurisdictional High Court in the decision cited supra. Since the aforesaid decisions are for the very same assessment year, respectfully following them, we hold that the Coral Hubs Ltd. was rightly rejected as a comparable. e–Clerx Services Ltd - it is seen that during the year under consideration, it has acquired a U.K. based company which has not only provided a large existing customer base in Europe, but by virtue of such acquisition, the company has been provided a platform in the European market to expand its business. Thus, the aforesaid acquisition during the year certainly has impacted the profitability of the company which is evident from the super normal profit earned by it during the year. Considering the aforesaid factual aspect, the Tribunal in Goldman Sachs Pvt. Ltd. [2015 (4) TMI 911 - ITAT MUMBAI] and Hyundai Motors India Engineering Pvt. Ltd. [2014 (3) TMI 680 - ITAT HYDERABAD] has excluded this company as a comparable - we uphold the decision of learned DRP in excluding e–Clerx Services Ltd. as a comparable. Mold Tech Technologies Ltd. - During the year under consideration, there was not only an amalgamation of Techman Tools Pvt. Ltd. but there was a demerger with Mold Tech Plastics Ltd. Thus, due to amalgamation and demerger, there is a definite impact on the profitability of the company, which is reflected in the super normal profit earned by it. Looking at the aforesaid factual position, the Tribunal in Goldman Sachs Services Pvt. Ltd. [2015 (4) TMI 911 - ITAT MUMBAI] and Transcent M.T. Services Pvt. Ltd. [2016 (4) TMI 356 - ITAT DELHI] has excluded this company as a comparable. As these decisions of the Tribunal are for the very same assessment year and there being no material difference in fact, respectfully following the aforesaid decisions of the Tribunal, we uphold the decision of learned DRP in excluding the Mold Tech Technologies Ltd. as a comparable. Grounds raised are dismissed. Revenue’s appeal is dismissed.
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